WRE News June 2, 2023
Seller
State Farm General Insurance Co. has ceased accepting new applications in California for business and personal lines property and casualty insurance, effective May 27.
In an unattributed press statement, the company said it “made this decision due to historic increases in construction costs outpacing inflation, rapidly growing catastrophe exposure, and a challenging reinsurance market.” The company, which is the leading home insurance firm in California, added that it would continue to serve existing customers in the state while accepting new applications for its personal auto insurance product.
“We take seriously our responsibility to manage risk,” the company continued. “We recognize the Governor’s administration, legislators, and the California Department of Insurance (CDI) for their wildfire loss mitigation efforts. We pledge to work constructively with the CDI and policymakers to help build market capacity in California. However, it’s necessary to take these actions now to improve the company’s financial strength. We will continue to evaluate our approach based on changing market conditions.”
State Farm is the second insurance company to exit from California’s home insurance market in two years – The American International Group withdrew pulling policies in the state in January 2022, citing risk concerns from wildfires. According to the California Department of Forestry and Fire Protection, there have been 985 wildfires in the state since the beginning of the year, with 1,024 acres burned.
Michael Soller, the Californian deputy insurance commissioner, responded to State Farm’s announcement in an emailed statement to Axios.
“The factors driving State Farm’s decision are beyond our control, including climate change, reinsurance costs affecting the entire insurance industry, and global inflation,” Soller said. “We have been here before after major wildfires. What’s different is the actions that we are taking with the first-ever insurance discount program for wildfire safety and unprecedented wildfire mitigation investments from the Legislature and Governor.”
Stay up to date on the latest real estate trends.
Lifestyle
May 9, 2025
Design thinking is an iterative problem-solving framework that puts users’ needs at the center of every tech solution.
Lifestyle
May 9, 2025
Growing your own culinary herbs, such as mint, rosemary, or thyme, is an excellent way to enhance your home-cooked meals while also honing your gardening skills.
Buyer
May 9, 2025
Mortgage application activity picked up with new gusto for the week ending May 2, according to data from the Mortgage Bankers Association (MBA).
Seller
May 8, 2025
As you think ahead to your own move, you may have noticed some houses sell within days, while others linger.
Buyer
May 8, 2025
With all the uncertainty in the economy, the stock market has been bouncing around more than usual.
Buyer
May 6, 2025
Saving up to buy a home can feel a little intimidating, especially right now.
We Guide Homeowners through the complicated process of selling their home using our 4 Phase Selling Process and 3 Prong Marketing Strategy that alleviates their stress and moves them effortlessly to their next destination. Schedule a 15 Minute Complimentary Strategy Session Today